It’s been a difficult journey for the cryptocurrency market in 2022. In November, the market had dipped by 70 percent from its previous high on November 20, 2021. Just when the market was going downhill and down, the FTX crash turned things even worse. The question is, can the crypto market recover in 2023?
Crypto Market Dips are Cyclical
The cryptocurrency market, specifically Bitcoin has experienced many drops in the past. Every time, it’s bounced back with a huge increase.
In 2013, for instance, Bitcoin reached a peak of $1,160, then fell for more than a year, reaching a low of $150. In 2017, it broke the record and hit a record record high of $19,600. Fast forward to 2018, it was trading at $3,100. In the year 2020 it struck through the resistance, and reached a record highest of $68,000 in November 2021. Just like that, we’ve witnessed another drop. But history shows us that following each dip, there’s a bull run.
Every Dip is Followed by a Long Bull Run
Just like we’ve seen previously, dips are usually followed by a long bull run that finally breaks through the resistance created by the market’s previous highest price. This pattern can be seen in not just Bitcoin but also in other cryptocurrencies.
Growing Use of Crypto and Blockchain
Crypto and blockchain technology have made significant progress in the last few years. With more and more businesses and industries adopting the technology, its use and acceptance is increasing. From finance to gaming cryptocurrency is being utilized in a myriad of ways. And this growing use case can lead to increasing participation in the market, which in turn could boost prices.
The rise in interest of institutions in cryptocurrency
In the last few years, we’ve seen a growing interest from institutional investors in crypto. From banks to hedge funds, many large institutions are beginning to investigate the possibilities for crypto-based assets. The increased interest of institutions could bring more stability to the market for crypto and could lead to more expensive prices.
Regulations of the government
As the crypto market grows, governments around the world are beginning to develop more favorable regulations for crypto. This will help draw more investors and increase the mainstream adoption of crypto.
Blockchain has many more applications.
The technology that is the basis of the majority of cryptocurrencies, blockchain is a broad range of possible applications beyond just financial transactions. From supply chain management to voting systems, more industries are exploring ways they can utilize blockchain technology, which could increase investment and enthusiasm in crypto.
Technologies are constantly evolving.
Blockchain technology and cryptography are at the very beginning of development. As progress is made in areas such as scalability and security, the potential of crypto assets will grow. This could lead to more adoption and higher prices.
Global economic uncertainty is growing
Due to the constant instability in the economy caused by the COVID-19 pandemic and other factors increasing numbers of investors are starting to look for safe haven investments like cryptocurrency and gold. Since the economic outlook for the world remains uncertain and uncertain, this could lead to an increase in demand for crypto and increased prices.
Retail investors are able to earn interest
Investors from institutions aren’t the only one who’s showing an interest in cryptocurrency. Retail investors, or even individual investors, are also starting to get involved in the crypto market. In the future, as more people learn about crypto and the best ways to invest in it, this could lead to more demand and higher prices.
A growing number of people are becoming aware of and accepting crypto
As the crypto market is maturing increasing numbers of people are starting to learn about and understand it. As the awareness and acceptance of crypto grows it could result in more people buying or holding cryptocurrency, and this could drive up prices.
crypto casino solution
Financial decentralization (DeFi) is an emerging area of the crypto market that enables the provision of financial services created using blockchain technology. As DeFi grows and more platforms and projects become available, this will lead to a rise in adoption and increased prices for crypto.
Developments in crypto payment methods
As the market for crypto is growing increasing numbers of companies are beginning using crypto to be a method of payment. This could result in increased usage of crypto in daily transactions and an increase in the cost of transactions.
More investment from sovereign wealth funds
Sovereign wealth funds, which are state-owned investments, are beginning to explore crypto as a potential asset class. As more of these funds dedicate a part of their portfolio to crypto, this could result in a rise in demand and more expensive prices.
Cryptocurrency is used for international payments
One of the biggest benefits of crypto is the capability to perform quick and inexpensive cross-border payments. As more businesses and individuals start to utilize cryptocurrency for international transactions it could result in increased the demand for it and a rise in prices.
An increasing number of crypto ATM’s
As the number of ATMs that accept crypto continue to grow, it will become easier for people to buy and store cryptocurrency, which can drive up demand and prices.
Security tokens are developed for development
Security tokens, or digital assets that are used to represent ownership of an asset, like stocks or real estate are rapidly expanding area of the crypto market. Since more and more security tokens will be issued and traded, it could result in a rise in demand, and thus higher rates for the crypto.
More adoption by merchants
With the increasing number of merchants accept cryptocurrency as a method of payment, it will make it more convenient for customers to hold and use cryptocurrency, which will drive up demand and prices.
So, will crypto grow in 2023? Only time will tell. But with these factors in mind, it’s likely that the cryptocurrency market will be able to see a rebound in 2023. If you’re committed to the long-term, being patient and disciplined is crucial.